The London Stock Exchange, in association with RSM Robson Rhodes, has published a guide to corporate governance for UK listed companies.
“Corporate Governance: A Practical Guide”, is available free of charge to UK companies and other interested parties. It is designed to give best practice guidance to boards on how to lead and direct their businesses. It is also part of a series of publications that the Exchange is introducing to help companies to comply with the requirements, and maximise the benefits, of a public quotation.
The guide covers selecting and developing a board and succession-planning, input to strategy, risk management, communicating with shareholders and corporate social responsibility. Fred Stone, Head of IR Solutions at the London Stock Exchange, explains that “corporate governance issues are at the forefront of the corporate agenda at the present time and we believe that this guide will provide practical insight into best practice on boardroom effectiveness to help boards achieve their strategic objectives and build enduring value in their businesses.”
The guide advises companies how to take account of the principles and provisions of the new Combined Code on Corporate Governance. Under current listing rules, all UK incorporated companies listed on the London Stock Exchange have to report on how they have applied the principles of the Code. The Code does not, however, specify the form that this part of the disclosure statement should take or the points it should cover.
Anthony Carey, the RSM Robson Rhodes partner responsible for boardroom effectiveness and the author of the guide, describes getting the right board in place and making sure it works effectively as a key business issue. “Building world-class companies starts at the top of the organisation, in the boardroom,” he says. “In implementing the new Combined Code over the next few months, boards have a great opportunity to do so in a way that builds enduring value in the business. They should avoid a tick-box approach which will add cost without maximising the return.”
The Stock Exchange says companies quoted on AIM should also find the guide a useful resource, though the Combined Code does not formally apply to them.